How Entrepreneurs in Botswana Can Start Trading Under the AfCFTA

The African Continental Free Trade Area (AfCFTA) agreement presents a huge opportunity for entrepreneurs in Botswana to access a larger market of over 1.3 billion people across Africa. However, it's important to understand how the AfCFTA will interact with Botswana's existing preferential trade arrangements. Here are the key steps to get started:

Understand Botswana's Current Trade Relationships

As a member of the Southern African Customs Union (SACU), Botswana already has duty-free trade with South Africa, Namibia, Lesotho and Eswatini. SACU members maintain a common external tariff and common customs territory.

Botswana also enjoys preferential market access to 12 other countries in the Southern African Development Community (SADC) Free Trade Area. Botswana will continue trading with these SACU and SADC partners under the existing arrangements even after the AfCFTA takes effect.

The real new trade opportunities for Botswana under the AfCFTA will be with countries outside SACU and SADC in East, West, North and Central Africa, with whom trade is currently subject to higher tariffs.

Identify Export Opportunities in New African Markets

Research the demand, competition, regulations and customer preferences in African countries outside SACU and SADC that you wish to export to under the AfCFTA[3]. Tools to assist with market intelligence include:

• The AfCFTA Tariff Negotiation Portal which provides tariff schedules and concessions.
• The African Trade Observatory dashboard with data on trade flows and market conditions.
• Sector-specific export guides and market surveys from trade promotion agencies.

Consider focusing on high-potential sectors like agro-processing, light manufacturing, and tradeable services where Botswana has a competitive advantage.

Ensure Compliance with AfCFTA Rules of Origin

To benefit from preferential trade terms under the AfCFTA, your products must comply with the Rules of Origin which define the criteria for goods to be considered as originating within the free trade area. Key provisions include:

• Goods must be wholly obtained within the AfCFTA region or undergo substantial transformation through sufficient value addition, change in tariff classification, or specific processing.
• Exporters must obtain a Certificate of Origin from the designated issuing authorities like Customs to qualify for preferential tariffs.

Use AfCFTA Trade Facilitation Mechanisms

Take advantage of the initiatives under the AfCFTA to simplify customs procedures and reduce trade costs, such as:

• The digital payments and settlement system to facilitate cross-border transactions in local currencies.
• The online mechanism for reporting and monitoring non-tariff barriers.
• Mutual recognition agreements to ease standards compliance and conformity assessments.

Leverage Support for AfCFTA Market Access

Seek out the funding options and technical assistance available to help SMEs and startups to trade under the AfCFTA, including:

• The $1 billion AfCFTA Adjustment Facility to support countries with revenue losses and competitive pressures.
• Capacity building and export readiness programs from development partners like the EU, UNDP and ITC.
• Grants and concessional loans from the Botswana government and financial institutions to expand production for exports.

With careful planning and support, entrepreneurs in Botswana can harness the AfCFTA to diversify their exports and grow into new African markets, while maintaining their existing duty-free trade with SACU and SADC partners. The agreement offers exciting possibilities for increased trade and investment across the continent.